Washington | Reuters — U.S. Agriculture Secretary Tom Vilsack said Thursday he hoped fertilizer and agriculture supply companies affected by the Russian invasion of Ukraine would not take unfair advantage of the situation, amid already-high fertilizer and crop prices.
Fertilizer costs have soared due to rising demand and lower supply as record natural gas and coal prices triggered output cuts in the energy-intensive fertilizer sector. Russia is a major potash producer and exporter of natural gas, a key input in producing nitrogen fertilizer.
Still, Vilsack said it was too early to tell what the impact of the Russia-Ukraine crisis would be on U.S. farmers.
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“It will take some time for impact to be felt. I hope that no company out there, whether it’s fertilizer or any other supply that may be impacted by this, will take unfair advantage of this circumstance or situation,” Vilsack said at a news conference. “That’s my biggest and deepest concern.”
Vilsack’s comments came a day after Iowa’s state Attorney General Tom Miller said he is seeking explanations for higher prices from top fertilizer producers, including Mosaic Co., Nutrien, CF Industries, Koch Industries and OCI N.V.
Iowa is the top U.S. corn producing state, and U.S. farmers are expected to scale back corn plantings this year in favour of crops that require less fertilizer such as soy.
Since January 2021, anhydrous ammonia prices have increased 315 per cent, Miller said, citing USDA data. Urea prices have increased by 214 per cent, while liquid nitrogen is up by 290 per cent and potash by 213 per cent.
Miller said his office is talking with other states about soaring prices.
“Data suggest that manufacturers are taking advantage of higher farm incomes to increase their returns, but we need more information,” he said.
— Reporting for Reuters by Leah Douglas in Washington and Tom Polansek in Chicago.
